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FAO lowers 2024 wheat forecast to 791 million tonnes

20 May 20242 min reading

In its May Cereal Supply and Demand Brief, the Food and Agriculture Organization (FAO) has adjusted its global wheat production forecast for 2024 down to 791 million tonnes. At this level, the 2024 world wheat outturn is still anticipated to exceed the 2023 output, albeit by a smaller margin of nearly 0.5 percent.

The FAO's downward revision is partly due to new data from the European Union indicating a larger-than-expected drop in wheat plantings. Although improved weather conditions in March and early April have bolstered yield prospects, the overall wheat production in the EU is now pegged at 128.4 million tonnes, marking a 4 percent decrease compared to the previous year. Similarly, Australia's wheat production forecast has been revised downward. The latest projections suggest limited growth due to the lingering effects of dry weather during the 2023 harvest.

Russia's wheat production forecast has also seen a minor cut, now standing at 93 million tonnes. This adjustment comes after a recent lack of rainfall in key southern regions. Despite this, the expected output remains above the five-year average. In contrast, Ukraine's wheat production is anticipated to fall significantly to 20.2 million tonnes. The ongoing war has severely impacted productive capacities and profit margins, resulting in well below-average yields.

In the United States, despite slight downgrades in winter wheat conditions in the southern Plains, the overall production outlook remains positive with an aggregate output expected to reach close to 52 million tonnes. Canada is forecasted to produce 34.6 million tonnes of wheat in 2024, assuming a return to trend yields after the low yields experienced in 2023.

Asia is poised for near-record wheat outputs, with conducive weather conditions in India and Pakistan supporting robust yields. Favorable production outlooks are also expected in Near East Asian countries. Conversely, North Africa continues to face poor wheat yield prospects. Recent localized rainfall arrived too late to offset the impact of widespread seasonal rainfall shortages since late 2023.

COARSE GRAINS

For coarse grains, Brazil's maize production forecast has been lowered to 111 million tonnes due to unfavorable weather in key producing areas. Despite this, the production still remains slightly above the past five-year average. In South Africa, hot and dry conditions since February have slashed yield expectations, with maize production now forecasted to fall 10 percent below the five-year average. Similarly, most Southern African countries are expected to see significant maize yield reductions due to intense rainfall deficits.

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